Utilization and Costs for Compliant Patients Initiating Therapy With Pioglitazone or Rosiglitazone Versus Insulin in a Medicaid Fee-for-Service Population

OBJECTIVES: To compare health care utilization and costs for type 2 diabetes patients initiating therapy with one of two thiazolidinediones (TZDs, pioglitazone or rosiglitazone) or insulin in a Medicaid population. METHODS: The study used a retrospective cohort design and included type 2 diabetes patients who initiated therapy with TZDs or insulin treatment during the 3-year period (1999-2001). These patients were identified from a Medicaid administrative claims database for approximately 230,000 fee-for-service Medicaid recipients using International Classification of Diseases, Ninth Revision, Clinical Modification (ICD-9-CM) codes: 250.0x-250.9x, where x=0 or 2). The first pharmacy claim for a TZD or insulin was treated as an index pharmacy claim, and utilization and costs were assessed for each patient for a 12-month follow-up period after the index date of the first pharmacy claim. A 12-month preperiod without a pharmacy claim for a TZD or insulin confirmed that the patient was newly prescribed with these medications. Analysis was restricted to a compliant sample receiving at least 6 pharmacy claims for either TZD or insulin in the 12-month follow-up period. The propensity matching technique was used to control for selection bias and potential imbalances between these groups at baseline. Patients initiating therapy with insulin or TZD were matched on the basis of demographics, year of index pharmacy claim, presence of microvascular/macrovascular complications, comorbidity, type 2 diabetes-related medical utilization and costs in the 12-month preperiod, overall health care utilization and costs in the preperiod, and type of oral hypoglycemic agents/other medications in the preperiod. Nonparametric bootstrapping was used to estimate the impact of therapy on both overall and type 2 diabetes-related health care utilization and costs in the matched sample. RESULTS: A total of 2,842 patients with type 2 diabetes patients met the inclusion criteria prior to exclusion of 881 patients (31.0%) who did not receive at least 6 pharmacy claims for either TZD or insulin in the 12 months following the index pharmacy claim, leaving 1,961 type 2 diabetes patients who initiated therapy with one of the two TZDs or insulin in the 3-year enrollment period (TZDs=1,523; insulin = 438). Propensity matching eliminated 1,271 patients (64.8%), resulting in a final sample consisting of 690 patients 345 patients per treatment group with comparable demographic and utilization parameters at baseline. In the 12-month follow-up period for the measures of overall utilization, patients initiated on TZDs did not differ significantly in the number of emergency room (ER)/hospitalization episodes and the number of pharmacy claims compared with the patients initiated on insulin, but they did have an average of 1.2 fewer physician office visits (9.3 vs. 10.5, P less than0.05). Compared with the insulin group, the TZD group incurred 35% lower costs for ER visits/hospitalization ($3,727 vs. $5,793, P less than0.01) and 18% lower total health care costs ($12,737 vs. $15,563, P less than0.05). No significant differences were observed between the groups in overall outpatient and pharmacy costs. When the analysis was restricted to type 2 diabetes-related utilization and costs, patients initiating therapy with TZDs had 0.8 fewer physician office visits (3.6 vs. 4.4, P less than0.05). However, TZD patients had 2.7 (14.1%) more diabetes pharmacy claims than patients initiating therapy with insulin (P less than0.01), but there was no difference in the number of type 2 diabetes-related ER visits/hospitalizations between the groups. The TZD group had 53% higher type 2 diabetes-related pharmacy costs than the insulin group ($1,678 vs. $1,096, P less than0.01). However, these costs were offset by lower costs for ER visits and hospitalization for the TZD group as compared with the insulin group ($2,855 vs. $5.090, P less than0.01) resulting in 25% lower total type 2 diabetes-related costs for the TZD group compared with the insulin group ($5,425 vs. $7,255, P less than 0.05). CONCLUSIONS: Medicaid fee-for-service patients initiated on either pioglitazone or rosiglitazone incurred higher diabetes-related pharmacy costs, which were offset by lower total type 2 diabetes-related medical costs, contributed primarily by lower costs for ER visits and hospitalizations in this 12-month analysis.

practice. The difficulty and expense of achieving tight glycemic control, coupled with the high prevalence of the disease and possibilities of long-term complications, make it important to consider the best strategy of choosing a therapy directed at tight control while simultaneously controlling for resource utilization.
Failure to control glycemic levels by diet and exercise typically leads to prescribing one of the many classes of oral hypoglycemic agents available in the market. The most recent class of oral hypoglycemic agents is the thiazolidinediones (TZDs), which were introduced into the U.S. health care delivery system in the 1990s. TZDs have a unique mechanism of action in improving insulin sensitivity. They are used as monotherapy as well as combination therapy and have been associated with effective glycemic control and reductions in various macrovascular complications associated with type 2 diabetes. 6,7 In addition to their ability to decrease insulin resistance and lower glucose concentrations, TZDs have been found to be associated with favorable effects on lipids, including an increase in high-density lipoprotein cholesterol (HDL-C) and reductions in triglyceride and free fatty acid levels. 8 Insulin has been utilized for more than 80 years in the management of diabetes and continues to serve as the definitive treatment for type 1 diabetes. 9 However, the pharmacoeconomics and medical indications for insulin are controversial in treatment of type 2 diabetes. It is not proven that use of insulin would produce benefits such as lower incidence of complications and better quality of life in patients with type 2 diabetes. 10 Because of favorable results from clinical trials, it has been recommended that insulin be used more aggressively and much earlier in the treatment of patients with type 2 diabetes. 11,12 However, the glycemic control demonstrated by insulin and TZDs in clinical trials might not be consistent with results in actual practice because of a lack of supervision and presumably decreased adherence to medication regimens.
In addition to the effect of choice of therapy on glycemic control, impact on economic outcomes must also be considered. Although the direct costs of hypoglycemic medications and supplies can be easily compared, data on how insulin therapy affects overall resource utilization in patients with type 2 diabetes are very limited, especially when compared with newer oral hypoglycemic agents such as TZDs. Experimental studies such as clinical trials typically do not include estimates of resource utilization, and this measure might not be valid because clinical trials require additional administrative costs in medical supervision and the resource use is mandated in large part by study protocols. [13][14][15][16] Pharmacotherapy for patients with type 2 diabetes entails continuous use of medications. Insurance sources may restrict the use of more expensive medications through cost control mechanisms like drug formularies, thus limiting access to expensive therapies. As part of efforts to avoid a dramatic increase in health care costs for type 2 diabetes patients and also ensure widespread access to efficient treatments, it is critical to compare health care costs incurred with new therapies versus conventional therapies. Although cost-effectiveness of TZDs as compared with older oral hypoglycemic agents has been documented in some studies using simulation models, 17,18 no study has reported cost-estimate comparisons between TZDs and insulin therapies in actual practice settings.
The objective of this study was to compare health care utilization and costs between type 2 diabetes patients initiating therapy with TZD or insulin in a Medicaid population.

Data Source
The study was conducted using medical and pharmacy claims data of a state Medicaid program (West Virginia [WV]   Medicaid). Insurance claims data are a valid source for identifying disease conditions and assessing utilization parameters and thus provide an opportunity to conduct inexpensive, nonintrusive research providing high statistical power in real-world settings. 19 This study was approved by WV Medicaid and the Institutional Review Board at West Virginia University.

Patient Identification
We identified patients with at least 1 inpatient admission with principal diagnoses of type 2 diabetes (identified using International Classification of Diseases, Ninth Revision, Clinical Modification [ICD-9-CM] codes 250.0x-250.9x, where x = 0 or 2) or at least 2 inpatient admissions/2 outpatient facility or physician office visit claims for which any diagnoses was recorded as type 2 diabetes.

Study Design
The study used a retrospective cohort design. The study compared a cohort of patients initiating TZDs (pioglitazone or rosiglitazone) with those initiating insulin in terms of their health care utilization and costs. The enrollment period extended from January 1, 1999, to December 31, 2001. The first pharmacy claim for a TZD (pioglitazone or rosiglitazone) or insulin was treated as the index pharmacy claim. A 12-month preperiod without a pharmacy claim for a TZD or insulin confirmed that the patient was new to the use of these medications. The analysis was restricted to patients with at least 6 pharmacy claims for the index drug in the 12-month follow-up period ( Table 1).

Exclusion Criteria
• Troglitazone belongs to the thiazolidinedione class of OHAs and was removed from the U.S. market in March 2000 due to its hepatotoxicity. 20 Hence, patients initiating therapy with troglitazone were not included in the TZD group, but troglitazone use was permitted in the preperiod (Table 1).
• Patients initiating polytherapy with a combination involving both insulin and TZDs were also excluded.
• The Medicaid fee-for-service medical and pharmacy claims in the administrative database did not include medical and pharmacy claims reimbursed through either Medicare or Medicaid managed care. Since Medicaid recipients aged 65 years and older are eligible for coverage under both Medicaid and Medicare, the subjects of this research were limited to all Medicaid recipients older than 18 years and younger than 65 years to avoid the issue of coverage under both Medicaid and Medicare. For similar reasons, Medicaid recipients who were part of managed care were not included in the study. Patients who were not continuously eligible in the follow-up periods were also excluded from the study. These exclusion criteria were used to ensure the availability of comprehensive health care utilization data for our study sample.

Study Outcomes
Health care utilization and costs were assessed over the period of 12 months postindex pharmacy claim.

Health Care Utilization
Physician office visits, emergency room (ER)/hospitalization episodes, and pharmacy claims were identified in the follow-up period. The number of physician office visits, ER/hospitalization episodes, and pharmacy claims were computed; ER visits that subsequently led to a hospitalization were not included, to avoid double counting. Overall health care utilization was computed irrespective of the diagnoses codes or National Drug Codes (NDCs). Type 2 diabetes-related utilization was computed by restricting the calculation of utilization variables to claims with a primary or secondary diagnosis of type 2 diabetes (ICD-9-CM codes: 250.0x-250.9x, where x = 0 or 2) and NDCs for diabetes medications or insulin.

Health Care Costs
Payments made by the Medicaid program to hospitals, medical providers, and pharmacies were used to compute the costs. For hospital costs, WV Medicaid reimbursement rates on the basis of diagnosis-related group (DRG) codes in the year 2002 were used. For DRG codes that did not have a reimbursement value from WV Medicaid, the relative weight of the DRG was used to assign hospitalization costs. (Each DRG code is associated with a relative weight. WV Medicaid reimbursement values on the basis of DRG codes were used to obtain an average reimbursement rate for a unit relative weight. For DRG codes that did not have a reimbursement value from WV Medicaid, the relative weight of the DRG was used to assign hospitalization costs. (A DRG weight of 1 was equal to $ 4,632.66, based on reimbursements from WV Medicaid in the year 2002.) This value was used in the calculation of costs for hospitalizations based on the relative weight of the DRG.) Since the administrative claims for patients were selected over the period of a few years, the costs were inflation-adjusted to 2002 costs using the medical care and prescription drug price indexes. 21 Overall health care costs were computed irrespective of the diagnoses codes. The components of ER/hospitalization, outpatient, and pharmacy costs were computed separately. Type 2 diabetesrelated costs were computed by summing paid amounts for claims with a primary or secondary diagnosis code for type 2 diabetes. Pharmacy claims for oral hypoglycemic agents and insulin were identified on the basis of NDCs). Pharmacy claims for diabetic supplies such as syringes, needles, and glucose testing equipment were also identified using NDCs. Type 2 diabetesrelated costs were examined separately in terms of ER/hospitalization costs, outpatient costs, and pharmacy costs.

Statistical Analysis
Descriptive frequencies were used to describe the study popuwww.amcp.org Vol. 12  lation. Evaluation of the choice of diabetes therapy on type 2 diabetes economic outcomes may be subject to selection bias since it is likely that the patients receive specific diabetes therapy based on the severity of their conditions. It is possible that patients prescribed insulin had higher A1c (glycosylated hemoglobin) levels at baseline compared with those prescribed TZDs.
Since normal regression techniques cannot adequately control this selection bias, propensity matching was used for analysis. 22 This technique employed an initial logistic regression model to obtain estimated probabilities of receiving TZDs as compared with receiving insulin on the basis of demographics, year of index prescription, presence of microvascular/macrovascular complications, comorbidity, type 2 diabetes-related utilization and costs in the 12-month preperiod, overall health care utilization and costs in the preperiod, and type of oral hypoglycemic agent/other medications in the preperiod. Patients with similar probabilities (± 0.01) to receive TZDs were matched, and analysis was restricted to this matched sample. This propensity matching technique helped in substantially reducing selection bias in estimating the impact of choice of diabetes therapy on subsequent health care utilization and costs. As the process of propensity matching leads to a comparable sample, further statistical control was not required. However, since utilization and cost data are not normally distributed, univariate tests such as t tests are inappropriate. Nonparametric tests such as the Mann-Whitney U test cannot be applied since they conduct significance testing on ranks as opposed to means. Hence, after propensity matching, nonparametric bootstrapping was used to evaluate utilization and cost differences between patients initiating therapy with TZDs or insulin. 23,24 The biascorrected and accelerated (BCa) method, which adjusts for skewness and nonconstant variance in the bootstrap sampling distribution was used. General guidelines recommend the use of 1,000 or more repetitions during bootstrapping. 25 Hence, 2,500 repetitions were used for calculating the BCa confidence intervals in the study. The statistical analyses were conducted using Statistical Package for Social Sciences, version 13.0 (SPSS Inc., Chicago, IL) and Stata, version 9 (Stata Corporation, College Station, TX).

II Results
A total of 32,183 patients, from a Medicaid population of approximately 230,000 recipients, were identified as having type 2 diabetes in the enrollment period (1999)(2000)(2001). After accounting for the inclusion/exclusion criteria, the study sample consisted of 1,961 type 2 diabetes patients initiating therapy with TZDs or insulin in the 3-year enrollment period (TZDs = 1,523; insulin = 438) (See Table 1). A propensity matching technique was used to restrict the analysis to patients who had comparable baseline demographics, utilization, complications, and comorbidities. The propensity score model used to predict the receipt of TZDs was found to be significant with a Nagelkerke R 2 value of 28.4% (Table 2). Patients were then matched based on their predicted probability (± 0.01) to receive TZDs. Three hundred forty-five patients initiating insulin therapy were matched on a 1:1 basis to 345 patients initiating TZDs. Ninety-three patients initiating insulin could not be matched to a patient receiving TZD and represented a distinct group of insulin patients to whom the study results are not generalizable. These unmatched patients were probably more severe at baseline since they had higher utilization and expenditures in the 12-month preperiod compared with the insulin patients who could be matched to patients initiating therapy with TZDs (Number of diabetes-related ER/hospitalization episodes in the 12-month preperiod  Table 3 indicates clearly that the propensity-matched sample of TZD and insulin patients was more similar on baseline variables as compared with the sample before propensity matching. Chi-square tests were used to examine differences in categorical baseline characteristics. For continuous data, bootstrapping on independent sample t tests was used to conduct the significance testing. The propensity-matched sample did not demonstrate significant differences between patients initiating insulin or TZDs on any of the variables related to patient demographics, year of index prescription, presence of complications, comorbidity, overall and type 2 diabetes-related utilization and costs in the 12-month preperiod, and type of oral hypoglycemic agent/other medications in the preperiod. Since the propensity-matched sample of patients receiving TZDs and insulin had similar demographic and utilization characteristics, the utilization and cost outcomes were compared using appropriate univariate analysis.

Overall Utilization
Nonparametric bootstrapping revealed that there was no significant difference in the number of ER/hospitalization episodes or the number of pharmacy claims between patients initiating therapy with TZDs or insulin. However, patients initiating TZDs had 11.4% fewer physician office visits as compared with patients initiating insulin therapy (P <0.05).

Type 2 Diabetes-Related Utilization
A subsequent analysis, restricted to type 2 diabetes-related utilization, indicated that patients initiating therapy with TZDs had 18.2% fewer type 2 diabetes-related physician office visits in the 12-month follow-up period (P <0.05). However, TZD patients filled 14.1% more diabetes prescriptions than patients initiating therapy with insulin (P <0.01). There were no significant differences in the number of diabetes-related ER/hospitalization episodes. or Rosiglitazone Versus Insulin in a Medicaid Fee-for-Service Population

Overall Costs
The type of diabetes therapy was found to have a significant impact on overall health care costs in the 12-month follow-up period, with TZD patients incurring 18.2% lower overall health care costs as compared with patients initiating therapy with insulin (P <0.05). These differences in overall health care costs were primarily due to 35.7% higher ER/hospitalization costs in patients initiating therapy with insulin than initiating therapy with TZD (P <0.05). No significant differences were observed in terms of outpatient and prescription costs between these groups.

Type 2 Diabetes-Related Costs
The choice of diabetes therapy was also found to have a significant impact on total type 2 diabetes-related health care costs, with patients initiating TZDs incurring 25.2% lower costs than patients initiating insulin therapy (P <0.05). Although the diabetes-related prescription costs were 53.1% higher for patients initiating TZDs than patients initiating insulin (P <0.001), they were offset by significantly lower type 2 diabetes-related ER/hospitalization costs for patients with TZDs (43.9%; P = 0.003). No significant differences were observed in terms of type 2 diabetes-related outpatient costs between these groups.

II Disussion
The results of our study demonstrated that overall health care and type 2 diabetes-related costs for a 12-month follow-up period were significantly lower for patients initiating therapy with TZDs as compared with those initiating therapy with insulin. The high acquisition costs of TZDs contributed to higher pharmacy costs for patients initiating TZDs versus insulin. However, these higher pharmacy costs were offset by lower costs for ER/hospitalization for the TZD group as compared with the insulin group. Though direct cost comparisons between TZDs and insulin have not been previously reported, other studies have reported resource utilization and cost comparisons between insulin and other oral therapies like metformin and sulfonylurea. Brown et al. 26 reported that, in a retrospective chart review of type 2 diabetes patients who had failed prior sulfonylurea therapy, addition of metformin was more cost effective than was the addition of insulin. Overall treatment costs were higher for insulin-treated patients.
Hayward et al. 13 reported an increase in outpatient visits, laboratory tests, and glucose monitoring devices for patients initiating insulin therapy as compared with those using sulfonylureas. These results were controlled for selection bias by adjusting for baseline severity of illness of the patients. This study also indicated that although insulin therapy was associated with lower A1c levels in all type 2 diabetes patients, it was only

Utilization and Costs for Compliant Patients Initiating Therapy With Pioglitazone or Rosiglitazone Versus Insulin in a Medicaid Fee-for-Service Population
modestly effective when prescribed for those who initially had A1c levels lower than 10%. Aggressive insulin therapy in such patients was associated with increased health care utilization, with only marginal benefits in glycemic control. Similar results in the present study show that a group of type 2 diabetes patients initiated on TZDs incurred lower resource utilization and costs as compared with a matched sample of patients initiated on insulin.
The higher incidence of ER/hospitalization in the insulin group in our study could be attributed to the high rate of complications reported with insulin therapy. Insulin has been reported to be much less effective in routine clinical practice than in trials because patients may be less motivated and have fewer resources, such as regularly available expert advice for prompt dose adjustments. 13 Hypoglycemia, a frequent complication of intensive diabetes therapy may be mild or severe and necessitate hospitalization. The incidence of hypoglycemia during insulin treatment is reported to be higher than during oral treatment. 27 In a study using medical and pharmacy administrative data, Heaton et al. 28 reported that, during the 6 years of follow-up, more than 16% of insulin-treated patients experienced hypoglycemia profound enough to warrant medical attention. The mean cost per episode was found to be $1,186 (range $181-$4,924) or $7.04 per patient per month. Although the financial burden is smaller than that of late complications of diabetes, hypoglycemia associated with insulin therapy may be associated with significant cost to the health care system.
With respect to insulin therapy, in addition to the costs associated with hypoglycemia, the costs of complications related to therapeutic hyperinsulinemia should be considered. 29,30 Increased plasma insulin level is considered by some as an independent risk factor for the development of atherosclerosis. [31][32][33] TZDs, on the other hand, have been reported to reduce blood pressure and appear to reduce atherosclerotic risk factors through several mechanisms. 34 Results of a case control study by Koro et al. indicated that TZD use was associated with a 49% reduction in myocardial infarction compared with the use of insulin, potentially translating into economic benefits. 35 Hospitalizations have been reported to account for 40% to 80% of the direct costs of diabetes mellitus 4,36 and include a high proportion of rehospitalizations, mainly conditioned by poor metabolic control and the presence of chronic complications. 37 Interventions designed to decrease the need for hospitalizations or more efficiently use services during a hospitalization can help lower the total costs of care associated with diabetes. 14

Limitations
Foremost among the limitations of this study was the imperfect measure of disease severity. Resource utilization in patients with type 2 diabetes can be affected significantly by baseline disease severity. Our analysis controlled for severity of diabetes based on information available from administrative claims data. Lack of clinical values such as A1c and blood glucose levels can raise concerns regarding the comparability of patients initiating insulin or TZD therapy. Selection bias was controlled by restricting the analysis to a comparable group of insulin and TZD users obtained after propensity matching. However, use of propensity matching may have resulted in the exclusion of type 2 diabetes patients who had higher disease severity and were therefore prescribed insulin. This could have resulted in the inability of our technique to match such insulin users to any TZD users in our study population. No comparative information for this severe group can be derived from our results, thus restricting the generalizability of our study results to presumably type 2 diabetes patients without extreme glycemic levels.
Second, it is also possible that patients initiated on insulin may demonstrate higher initial treatment costs due to an increased frequency of physician office visits for dosing adjustments and instruction/education. These short-term start-up costs may not be an important factor over a longer follow-up period. Because of a short duration of follow-up in our study (1 year), treatment costs for insulin may appear artificially higher. However, our study showed that the increased costs for patients initiated on insulin were primarily a result of ER/hospitalization episodes not increased outpatient visits.
Third, the study results are limited to recipients younger than 65 years who were part of a state Medicaid fee-for-service program. Since the present study was conducted in WV Medicaid, it is not necessarily representative of other state Medicaid programs and may differ significantly from a managed Medicaid population.
Fourth, administrative claims data more recent than 2002 were not available, resulting in the use of claims data from 1999 through 2002. Troglitazone was the most frequently prescribed TZD in 1999 but was withdrawn from the U.S. market in March 2000. In this study period, we restricted our analyses to rosiglitazone and pioglitazone. Troglitazone was excluded from consideration as an index medication in 1999 through March 2000, when it was withdrawn from the market. It is not known how this factor might have confounded the study results, but some patients with an index pharmacy claim for troglitazone would have been excluded from the present study.
This study is also subject to several limitations that are inherent in investigations that rely on the use of administrative claims data. 19 Since administrative claims data were used to determine cost estimates, errors due to billing and coding cannot be ruled out. Only those costs incurred by the WV Medicaid Program were examined. Expenses for health care services incurred by sources other than the WV Medicaid Program were not included in the analysis. For example, drug utilization information about over-the-counter drugs and prescription samples received in the physician' s office were not measurable. This may lead to potential misclassification and an underestimation of overall resource utilization.

II Conclusion
Clinicians treating patients with type 2 diabetes are faced with the task of selecting therapy that can maintain appropriate glycemic levels as well as control resource utilization and expenditures. The best therapeutic alternatives may differ based on the baseline glycemic levels and disease severity of the patients. Our study results indicate that, in a population of type 2 diabetes patients without significantly high utilization and costs at baseline, the initiation of TZDs was associated with lower health care resource utilization and costs compared with patients initiated on insulin therapy.

DISCLOSURES
This study was presented, in part, as a podium session at the annual meeting of the International Society for Pharmacoeconomics and Outcomes Research (ISPOR), Washington, D.C., May 18, 2005. It was supported by a grant from the Outcomes Research (Medical and Scientific Affairs) Department at Takeda Pharmaceuticals North America Inc., Lincolnshire, IL. Author Shrividya Iyer is an employee of Takeda Pharmaceuticals; Rukmini Rajagopalan was an employee of Takeda Pharmaceuticals at the time of this study. Funding was obtained by author Jan Kavookjian. The authors disclose no other potential bias or conflict of interest relating to this article.
Iftekhar Kalsekar served as principal author of the study. Study concept and design were contributed by Kalsekar, Iyer, Rajagopalan, and Kavookjian. Data collection was primarily the work of Kalsekar, Iyer, and author Reema Mody, with input from Kavookjian and Rajagopalan; data interpretation was the work of Kalsekar, Mody, and Kavookjian, with input from Iyer and Rajagopalan. Drafting of the manuscript was primarily the work of Kalsekar and Iyer; its revision was the work of all authors.